Federal law requires Congress to authorize the government to borrow the money needed to pay for the programs that Congress has passed. In other words, Republicans in Congress are threatening to refuse to pay off their own bills by raising the debt ceiling.
President Obama warned Saturday morning, “If Congress refuses to give the United States the ability to pay its bills on time, the consequences for the entire global economy could be catastrophic. Our families and our businesses cannot afford that dangerous game again.”
Apparently Republicans are so offended by their own votes/programs/policies that they think downgrading our credit again might be the best thing they can do for America.
In 2001, Bush inherited a surplus from Clinton; However, in every year starting in 2002 we were operating at a deficit. Each year’s deficit goes into the pot and becomes part of our debt. So for each year that we fail to collect enough revenue to pay off our spending, we contribute to our debt and it keeps growing.
Public debt rose under Bush as a combined result of the Bush tax cuts (less revenue) providing less money to pay for spending, while they increased spending with two unfunded wars (borrowed money for the wars was left off of the budget by the Bush administration until the Obama administration put it on the budget — no more creative accounting, please) and Medicare Part D, an unfunded “entitlement program” initiated under the Bush administration. These are facts, not spin. When you spend more money while you earn less, you end up in debt.
Conservatives like to blame non-defense discretionary spending, but “In fact, such spending, accounting for only 15 percent of the budget, has been basically flat as a share of the economy for decades. Cutting it simply will not fill the deficit hole.” Much of that debt is war debt and we all know how we got that. The fact is that public debt as a share of GDP goes up when we are at war.
We also spent a lot of money in order to bail out too-big-to-fail banks under Bush after the global financial crisis. This program was called Troubled Asset Relief Program (TARP). Contrary to conservatives’ understanding, TARP was Bush’s baby.
The CBO estimated at the time that TARP would cost around $189 billion. So, in 2009 when Obama took office, the CBO was saying we had a $1.2 trillion deficit for 2009 (2009’s budget was based on Bush policies) and they predicted future deficits due to continuing Bush’s policies (by policies they mean the Bush tax cuts- yes, the very cut Republicans have been demanding for the rich ever since Obama wanted to raise some revenue to address our debt) and the recession. Recessions cost money.
We spent more money trying to recover from the crisis under Obama. We refer to that spending as the “stimulus” – something conservatives mocked when Obama did but something they supported when Bush did. Stimulating the economy was never a bad thing before, but suddenly conservatives don’t want it stimulated. They want the economy to stagnate or recess even further, as evinced by their many votes to obstruct the things the economists agree we need in order to stimulate the economy.
You aren’t likely to hear a conservative admit that the stimulus was a temporary program, unlike a “policy” of a permanent tax cut for the rich. In other words, Bush’s policies got us into debt. Obama’s stimulus increased the debt, but is not a policy. It was only temporary.
Now our debt is very large. Before we concern troll over how large it is, we need to take responsibility for how it got here. It wasn’t the American people paying into Social Security who were borrowing money they couldn’t/wouldn’t pay back.
The folks whose votes contributed in large ways to the debt now want the American citizens to pay for the failure of this ideology, while refusing to admit that it does not work as they believed it would.
Republicans are doubling down by trying to use the deficit their policies created in order to push more of their policies onto the people. This time they’re using their failed policies to justify killing social programs they never liked to begin with, but are unrelated to our current deficit problem. (Yes, some of these programs will need to be reformed in the future, but they are not the cause of the current debt problem.)
Republicans are also telling Americans who have paid into the Social Security Trust Fund their entire working lives that they do not want to make good on that promissory note. As Reagan explained, this money is in its own trust and has nothing to do with the deficit.
The debt ceiling has been raised under previous administrations as part of the unpleasant course of business. It was unthinkable when Republicans used it to destroy our credit in 2011, earning America our first credit downgrading. Your credit tends to go down when you signal to lenders that you may not pay them back (raising the debt ceiling can be seen as the promise to pay back what we already spent).
Conservatives seem to believe that raising the debt ceiling is about new debt, when in fact, it is a promise to pay off existing debt. Try telling the credit card company that you MIGHT pay off your debt if only they will first give you some things you’ve been wanting for a long time. That’s what Republicans are doing.
So what we really have here are alleged fiscal conservatives trying to break America’s contract with lenders, as if you ran up your credit cards and then just told the bank that you refused to pay it back because you are philosophically against the idea borrowing (but obviously not against the idea of stealing). Then you suggest the banks go dip into your neighbor’s contributions to their retirement fund in order to pay off your debt.
The time for Republicans to fight over the budget is in the budget fight, not the agreement to pay off our debt. Republicans keep fear-mongering that they have to threaten our credit rating because of the debt they don’t want to hand down. They should have thought of that when they were actually voting yes on the policies that created the debt, not later, after the money has already been spent.
No one disputes that we have a debt problem. The dispute derives from the fact that Republicans refuse to admit how we got here, which suggests that their solutions are just as dishonest. Yes, Democrats passed legislation that cost money as well, but they aren’t pretending they aren’t responsible for authorizing the government to borrow the money they spent. Furthermore, Democrats didn’t refuse to raise the debt ceiling under Bush just because they disagreed with the wars. And that’s basically what Republicans are using the debt ceiling showdown for — it’s just another way to attack social programs they don’t like.